Uniswap-Polygon liquidity providers Frens incentive

Proposals by Gotchi Gov'nuhs
1

Frens,

TL;DR: Uniswap is deploying on Polygon in a matter of days. We should incentive Uniswap on Polygon LPs with Frens.

It may have come to your attention that Uniswap is deploying in days to the polygon network. Uniswap has generally been the highest volume AMM and DEX for ERC20 tokens in the last year. It has been deployed to the Arbitrum Network successfully with good volume.

It is true that they have let clones deploy first to many EVM’s like Pancakeswap on BSC and Quickswap on Polygon Network. Most of these clones are clones of Uniswap V2 and Pancakeswap (which it self is a clone of Uniswap V2), as far as I know. The Uniswap team has worked to improve it’s platform decrease slippage, reduce gas fees, and released a V3.

Although Polygon had a lot of volume in Spring, it does look like volume has fallen off amongst all AMMs. Uniswap might be able to bring volume from ETH Mainnet to polygon. Uniswap has at least 3 great things going for it. 1. It has a brand name as the first major AMM, I’m not even sure if they invented the concept, but their reputation is that they invented the technology. 2. They have institutional support from organizations like Grayscale. 3. The Polygon team believes Uniswap coming to Polygon is worth incentivizing. Although, it’s not explicit, I think the Polygon team believe it can bring more money and volume for the Polygon ecosystem.

We should ride the coattails of this new Polygon paartner and also incentivize Uniswap adoption.

Why? Uniswap works basically like quickswap and sushiswap. There need to be liquidity providers for trades to go through. Liquidity providers typically move to where there they can get the highest return with the least amount of risk. If no one is incentivized to provide liquidity, then it is possible there will be very low liquidity on their platform for people based off other incentivizes that exist outside of Frens.

How? We should incentivize Uniswap LPs with Frens so that it has at least as much liquidity as quickswap within a day of their deployment. I think the first days will be the important ones and the days where we might able to get even Polygon incentives if we can reach out to their team.

If for whatever reason Uniswap doesn’t get the volume I expect, then the Frens incentives given to Uniswap LPs should get lowered to that respect that it doesn’t surpass Quickswap volume.

I am not on the Frens Taskforce, but it I would be interested in going over the numbers to make sure the Frens incentives can be done accordingly. The intention is that Uniswap gets incentivized at least as much as Quickswap and Sushiswap (whichever is greater).

  • Incentivize Uniswap LPs with Frens
  • Don’t Incentivize Uniswap LPs with Frens

0 voters

4 Likes
2

Any specific LP pool you have in mind?

2 Likes
3

This is what’s trading on mainnet. This is what’s trading on Polygon network.

I believe GHST-MATIC pair would be best based off those trends and trends I see on other Layer 2s. I think it’s simplest and best to just incentivize that pool at the start.

There will be some incentives given by Polygon Network to Uniswap. We should ask the powers that be if we can get some of those Polygon incentives too for our GHST-Matic LPs. We have been a partner with Polygon and Aave (to name a few paartners) for a while and I think if we ask the right people we can get some extra Polygon incentives for our Uniswap LPs. We have a consistent trading volume all the time, a super active DAO, and innovative project in the metaverse space.

4 Likes
4

Let’s play devil’s advocate: Have you thought about the impact this proposal could have on our liquidity on other platforms? We currently incentivize GHST-USDC, GHST-ETH & GHST-QUICK on Quickswap and (very soon) GHST-MATIC on Sushiswap. Why should another pool be added, which could come at the expense of Quickswap/Sushiswap liquidity & FRENS dilution even though Uniswap doesn’t reward our pool in any way?

4 Likes
5

Ser Moon,

Have you thought about the impact this proposal could have on our liquidity on other platforms?

I should clarify that the purpose of this proposal is to promote Aavegotchi and GHST. It isn’t to pick a winner or loser in the DEX wars. But I do believe Uniswap is a leader in the DEX space and we should have liquidity on the platform. It is logical that as incentives increase, liquidity increases and vice versa (in a vacuum). It is also logical increased holders, traders, and players is good for the price too. In fact more trading means more trading fees rewarded for Liquidity Providers. I think a promotion like this can increase our reach on Polygon and even ETH mainnet.

However, there would have to be some reduction in Frens incentives from other pools to properly incentivize Uniswap and avoid Frens dilution. For many Liquidity Providers it doesn’t make a large difference whether they are providing liquidity on Uniswap or Quickswap or even IDEX (which was giving us bonuses this month). There is actually a lesser amount of risk associated with bigger platforms like Uniswap IMO. So as if we were to incentivize a larger DEX and reduce incentives on a smaller DEX, it’s obvious where the liquidity will flow up until a certain equilibrium.

It is the responsibility of the DAO to properly incentivize the best places to provide liquidity through Frens. Although I feel like every DEX has its own merits, Uniswap and its upcoming deployment on Polygon can be an opportunity to get Aavegotchi in front of a lot of new faces.

even though Uniswap doesn’t reward our pool in any way

Part of the Uniswap deployment governance proposal included a Polygon incentive. I think if we ask the right people we can have incentives on our pool. If they don’t, the trading fees alone on the platform may surpass rewards and trading fees on other platforms like Sushiswap and Quickswap.

I don’t think any of our incentives should be permanent. And we should adjust with the market. For example, if Uniswap has a poor deployment or lists on the last page and we get no volume and no incentives, then in a month we can revisit our Frens incentives. I hope for this best however and think they might show a fellow Polygon partner some frenliness. I think we can all do this for our H1 Gotchi collateral frens.

3 Likes
6

I think we need to choose which positions will be incentivized if this happens, and specifying pairs is not enough. AFAIK, uniswap V3 doesnt just have one position for a liquidity pool. It’s an amalgamation of all the different positions that people choose to hold within that liquidity pool. Maybe we can wait to see which liquidity positions are popular and then incentivize those?

1 Like
7

I’m not opposed to Uniswap or providing more liquidity and I see how creating a GHST/ETH LP on the Polygon Uniswap would help Uniswap, but given GHST already has a few LP pairs on Polygon I’m not convinced it really adds much additional value for Aavegotchi at the moment. Also, we could really choose any number of AMMs if we want to expand LP. For example, why not incent liquidity on 1inch platform for a GHST/1inch pair given we already use their DEX Aggregation service for swaps on the platform? If we really wanted to expand the LP for GHST, perhaps a vote on which AMM should be used would be beneficial first?
That said I think the biggest consideration should be given to the Frens dilution that Moon mentions above. I think this is something the FTF would have the data on to better inform if further incentive is necessary. Without even looking at the data, the market for tickets and the amount of them being committed doesn’t seem to warrant additional Frens incentives(perhaps a redistribution of the frens incentive we already have could be an alternative option)

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While I don’t think it’s necessary for us to accommodate all different protocols(it’s just as likely somebody uses uni as sushi or 1inch), I do feel it’s nice to have different options available(esp with the recent sushi hubub). Frens aren’t getting diluted because we have pools managed in various protocols, they get diluted because ghst is based, aavegotchi has a bright future and the rewards are good. As it stands, frens are getting heavily diluted(by whales parking their money not involved in the ecosustem) and this will continue as aavegotchi grows. The more liquidity we can garner the better… even at the behest of frens valuations IMO. I do however have qualms about offering more incentives from the treasury unless they are fairly matched.

I feel that Uni offers a great opportunity on par with Sushi, and there is little reason the LPs there would earn less frens.

The days of 30ghst mythic tix are long gone.

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Question about the Uni launch – it’s V3 right? Which means that LPs receive an NFT instead of an LP token. Currently our staking contracts are not setup to receive NFTs, and although this could be added, it’s not on the current roadmap.

2 Likes
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I see. I would like to attend a future Frens Committee meeting. Just to learn more and participate and see what the roadmap is.

Currently our staking contracts are not setup to receive NFTs, and although this could be added, it’s not on the current roadmap.

If we can’t get the Frens incentives immediately. I would like to us try to get incentives from Polygon or Uniswap. I don’t know how they are giving incentives, but we should have a (Pixelcraft) representative talk to those teams about if they could give our GHST-MATIC LPs, UNI+MATIC tokens. I think this discussion showed support for that as well.

If the new staking contract requires DAO process, then I can get started on a proposal. I would just like to have a Frens Committee to know what the resources are like before prioritizing something like this.

11

Uniswap is pretty well-known for not giving out any incentives, have you seen anything that indicates otherwise? Happy to get into contact with them if that’s the case.

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The uniswap proposal by Polygon team included some incentives. I assumed that goes to LPs in the form of MATIC tokens. Like an ordinary liquidity mining, like quickswap. I’m not an active user of V3 either, so I can’t say for certain the mechanics and it would be nice to get the details because I’m working on assumptions. We can’t know if we don’t ask of talk to the people in the know. I think we should start a communication with Polygon or Uniswap.

Uniswap DAO passed a consensus check proposal, which included some liquidity mining on Optimism and Arbitrum: uniswap consensus proposal. It seems reasonable to expect the polygon protocol to also pass consensus for liquidity mining. Uniswap deployed on those other protocols (AFAIK) months ago, and on Polygon just this week. I will research some more whether those incentives are live, still in proposal phase, and what they are, but just trying to get back to you with this info asap.

1 Like
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I think we need V3 Optimizer, like Popsicles finance, not raw V3 position. @coderdan

1 Like